Case Study: HomeStreet Bank streamlines CECL transition and testing with Abrigo Advisory Services

HomeStreet Bank prepares a 5-year capital plan with Abrigo CECL advisory

HomeStreet Bank faced the significant challenge of transitioning from an incurred loss model to the new CECL accounting standard. This required a fundamental shift from estimating losses based on past experience to forecasting expected losses over the entire life of its loans. The bank needed expert third-party guidance and lacked the internal bandwidth to manage this sizable project alone, so it turned to Abrigo for a solution.

Abrigo's advisory services team worked with HomeStreet Bank to develop a full CECL Blueprint. This involved a data gap analysis and designing customized pooling structures and methodologies for the bank's loan portfolio. The result was a complete plan for the CECL transition. HomeStreet Bank is now positioned to test its methodology and run parallel estimates to understand the full enterprise-wide impact of CECL, including on its future capital requirements.

HomeStreet Bank